Egypt secured its biggest non-oil foreign direct investment deal since it floated the pound, Investment Minister Sahar Nasr said, as Dubai-based Al Ghurair Group agreed to put $333 million into a new sugar factory and farm.
Canal Sugar Co., a subsidiary of family-run conglomerate Al Ghurair, will hold a 33 percent stake in the project about 165 miles (265 kilometers) south of Cairo, rising to 51 percent when it is finished in three years, the government said on Monday. Egyptian companies, including Al Ahly Capital Holding, will hold the remaining stake, Nasr said at a press conference.
Egyptian officials were betting on a revival in foreign investment to boost growth and create jobs when they floated the pound and secured a $12 billion loan deal with the International Monetary Fund in November 2016. Overseas investors have been eyeing the food, health and education sectors in Egypt to capitalize on the 96-million population — the Arab world’s largest.
“Sugar is a priority sector, and this deal is the result of close cooperation across ministries,” Nasr said.
The new factory will cost $450 million and produce 1 million tons of sugar annually, enough to cover about 80 percent of Egypt’s production gap, according to the government. Local production currently meets about 70 to 75 percent of Egypt’s annual demand, with the remainder coming from imports.
Nasr said the project will benefit from a tax break for three years because it will be located in Upper Egypt. “It helped us secure the deal and direct it to the most needy parts of Egypt,” she said.